A $40 million fund, comprising seized assets, has been made available for victims of the OneCoin cryptocurrency scam to seek compensation, as announced by the US Department of Justice. The scheme, which operated from 2014 to 2019, was perpetrated by OneCoin Ltd.
co-founders, including Ignatova and Karl Sebastian Greenwood, and resulted in the defrauding of approximately 3.4 million investors worldwide. The fraudulent cryptocurrency, marketed through a global multi-level marketing network, amassed over $4 billion in investments despite not being a legitimate cryptocurrency and not existing on any blockchain.
The Ponzi scheme collapsed in 2017 after the manipulation of OneCoin's value was discovered. In recent developments, the DOJ has been working to seize further criminal proceeds, with a $5 million reward offered for information on the missing 'Cryptqueen' in June 2024. According to US Attorney Jay Clayton, the founders 'sold a lie disguised as cryptocurrency,' resulting in losses exceeding $4 billion globally. The compensation process for OneCoin victims comes as the FTX Recovery Trust prepares to distribute $2.2 billion to creditors, marking the fourth payout under the exchange's Chapter 11 plan, with previous rounds totaling over $6 billion in the effort to recover assets for users of the collapsed crypto trading platform.